Tether Asks Turkey to Consider Borate Minerals Digital Token – BNN Bloomberg

(Bloomberg) – Tether Holdings Ltd. sought to persuade Turkey to use digital assets to overhaul the country’s boron market, the latest sign that the crypto industry is tapping the commodities sector for further growth.

Stablecoin issuer Tether has made a proposal to government officials to use blockchain technology to create digital tokens representing borate minerals, people familiar with the matter said, asking not to be named in private discussions. Tether has also expressed the idea of ​​setting up a digital asset exchange in the financial capital Istanbul, it said.

The Bor coin proposal falls into the emerging field of tokenization, the process of using digital ledgers to create representations of real-world assets. Proponents argue that tokenization can help modernize some markets.

Boron products are primarily used to make ceramics, detergents, fertilizers and glass. Turkey’s monopoly, state-owned mining group Eti Maden Isletmeleri Genel Mudurlugu, estimates that the country has more than 70% of the world’s reserves. The government forecasts sales of about $1.3 billion in 2024.

Crypto Introduction

While it is not clear exactly why Tether is focusing on boron and what benefits its proposal would bring, Turkey is generally attractive to digital asset companies as high inflation and a volatile lira drive cryptocurrency adoption. Data from blockchain intelligence firm Chainalysis shows the country received nearly $137 billion in crypto inflows in the 12 months ended June this year, the seventh-largest total globally.

A Turkish government official said the boron proposal was currently unworkable, while a bureaucrat at the country’s energy ministry said talks with Tether were at an early stage.

LinkedIn posts show that Yalcin Aydin, general manager of Eti Maden, is among the officials that Tether’s local expansion manager Anadolu Aydinli has met with in recent months. Others include Turkish Vice President Cevdet Yilmaz and Energy Minister Alparslan Bayraktar. Turkey’s Energy Ministry and the Office of the Presidency declined to comment.

In a statement, Tether CEO Paolo Ardoino said the company is “deeply committed to driving innovation in Turkey’s digital asset landscape” and is keen to continue exploring new growth opportunities.

Tether issues the world’s largest stablecoin USDT, a token said to have a constant value of $1 and whose circulation has increased to $120 billion. The digital asset is the preferred place to park funds for crypto trading.

The company is also increasingly touting its replacement dollar as a way to process payments cheaper and faster by limiting the use of traditional banking channels – particularly in emerging markets where U.S. dollars can be in short supply.

Expansion Manager

Aydinli is among a circle of expansion managers for Tether around the world, many of whom have worked with the company in the past year, according to LinkedIn profiles. The new hires for countries including Venezuela, the Philippines, Thailand, Indonesia and the United Arab Emirates, as well as Africa and Latin America, highlight the company’s ambitions to expand beyond its crypto roots.

“There is growing interest in using stablecoins like USDT for payments – particularly cross-border payments,” said Angela Ang, senior policy advisor at blockchain intelligence firm TRM Labs.

Tether is already considering lending to commodity trading firms to capture some of the profits from its stablecoin operations. These meetings included discussions about how USDT could penetrate deeper into hard asset cash flows. Tether invests the funds that support USDT’s dollar peg into investments such as government bonds, and the interest earned led to a record profit of $5.2 billion in the first half of 2024.

There are signs that USDT is gaining traction among commodity producers and brokers in countries like Venezuela and Russia, which are subject to myriad US sanctions and lack easy access to the global banking system. The shift poses a challenge for global regulators trying to monitor the flow of money.

– With support from Sidhartha Shukla and Suvashree Ghosh.

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